The US was quick to condemn the Interior Ministry's decision
to approve the construction of 1,600 housing units in east Jerusalem on Tuesday.

Vice President Joe Biden, currently visiting
Israel, said, "I condemn the decision by the government of Israel to advance planning for new housing units in east Jerusalem. The substance and timing of the announcement, particularly with the launching of proximity talks, is precisely the kind of step that undermines the trust we need right now and runs counter to the constructive discussions that I’ve had here in Israel."

The White House's top spokesman Robert Gibbs noted that President Barack Obama's position on the settlements is known by both the Israelis and the Palestinians.

Palestinians were also angered
by the announcement, and the Prime Minister's Office was acutely embarrassed by the lack of coordination between Interior Minister Eli Yishai (Shas)
and Prime Minister Benjamin Netanyahu.

Palestinian President Mahmoud Abbas
spoke with Arab League Secretary-General Amr Moussa, and discussed what Abbas called "the provocative and predetermined Israeli escalation, following the Palestinian authority's decision to renew the negotiations."

Netanyahu,
who met with Biden twice on Tuesday, was taken by surprise following the unexpected announcement. The prime minister, who was trying to present a seemingly frank effort to promote negotiations with the Palestinians did not reprimand Yishai, however the crucial timing – with Biden's visit to the region – seemed potentially devastating, said sources close to Netanyahu.

Constuction site at Ramat Shlomo (Photo: AP)

In the statement issued Tuesday night, Biden emphasized, "We must build an atmosphere to support negotiations, not complicate them. This announcement underscores the need to get negotiations under way that can resolve all the outstanding issues of the conflict.

"The United States recognizes that Jerusalem is a deeply important issue for Israelis and Palestinians and for Jews, Muslims and Christians. We believe that through good faith negotiations, the parties can mutually agree on an outcome that realizes the aspirations of both parties for Jerusalem and safeguards its status for people around the world.

"Unilateral action taken by either party cannot prejudge the outcome of negotiations on permanent status issues," Biden added. "As George Mitchell said in announcing the proximity talks, 'we encourage the parties and all concerned to refrain from any statements or actions which may inflame tensions or prejudice the outcome of these talks'."

The plan will extend the Ramat Shlomo neighborhood in a southeasterly direction, upgrade the entrance road and add an access road from the west. The plan spreads across some 580 dunams (143 acres), while the average size of each housing unit is 120 square meters (1,290 square feet).

The plan has been submitted for public comment. The public has 60 days to file an objection to the plan, which will then be discussed by the committee – a process that could take some time.